MOSCOW - Seeking to guarantee greater energy and food security for its population, China is coming up against serious limitations. Just look at the basic numbers: the country only has 8% of the world’s energy reserves, and only 11% of the world’s arable land – yet, it is providing for 19% of the planet’s population.
At the same time, one should remember that the whole world is undergoing rapid urbanization, and more and more people worldwide are adopting the consumption model associated with the middle class, of increased demand for meat, fish, fruits and vegetables, greater use of private cars, and so on.
It is very likely that by 2020, China will not yet have exhausted its energy or agriculture potential. But at the very least, three important raw materials - oil, gas and soy beans - will not be produced in sufficient quantities inside of China.
How to provide the Chinese economy with energy
The Chinese government has been following an aggressive program of increased energy efficiency throughout the national economy. That is why the country’s energy use is going to increase by around 4% each year between 2010 and 2020.
According to current projections, it will increase more slowly than the country’s GDP. But in a country as large as China, even a small percentage increase can be a lot in absolute terms. Just the estimated annual increase in Chinese energy use represents all of Russia’s current annual energy use.
What is the Chinese government doing to plan for increased energy security? About half of the energy will be produced using nuclear, coal and hydro power plants. In spite of those plans, China will also need to increase its oil and gas imports by 200%, causing its overall imports to increase by around $300 billion.
China is using four strategies to ensure that it has access to the necessary oil and gas supplies, and all of them could open doors for Russian oil and gas companies.
First of all, China is working on a pipeline network that would connect it with neighboring countries, including Russia. China and Russia are currently discussing the construction of two new gas pipelines. Secondly, China’s state-owned energy company is taking part in new gas and oil drilling projects around the world, investing major sums of money, although they are not investing anything in Russian projects. Third, China is working on long-term contracts on deliveries via gas tankers, which could easily include gas from the area around Vladivostok in eastern Russia. Lastly, Chinese players in the gas market are looking for partners among gas companies that have the resources to look for and drill gas in non-traditional sources, including offshore.
The agricultural revolution in China has allowed its yield to increase quickly over the past 50 years. As a result, today, China absolutely does not depend on crop imports (98% of demand is met by domestic production). But with increases in the size and wealth of the Chinese population, there will be a lot of possibilities for countries that produce low-priced crops, such as the United States, Russia and Ukraine, to work with China.
There is yet another opportunity due to changes in what Chinese people are eating – the demand for high quality meat, fish, fruits and milk products is increasing. As a result of this trend, the amount of imported food products is increasing, as are territorial investments on the part of Chinese companies in foreign countries.
Chinese companies already own land in many countries around the world. For example, there are fish farms in Malaysia, sugar plantations in Australia, palm oil producers in Africa and fruit orchards in Chile that belong to Chinese companies.
Soy - which is used for many oils, and to feed livestock - is only one of the many agricultural products that are expected to see an increased demand and increased imports. Latin American countries already provide about 75% of Chinese soy imports, and in the future, as new opportunities present themselves, those countries will take advantage of the situation, and perhaps sell or rent Chinese companies land to grow soybeans on.
Supplying China with the energy and agricultural resources it needs in the coming years will not be easy. That is why foreign partners will take the opportunity to make millions of dollars by exporting to China, as well as by opening up opportunities for Chinese companies to operate on their country’s territory.
Will flying be greener? More comfortable? Less frequent? As the world eyes a post-COVID reality, we look at ways the airline industry has been changing through a pandemic that has devastated air travel.
It's hard to overstate the damage the pandemic has had on the airline industry, with global revenues dropping by 40% in 2020 and dozens of airlines around the world filing for bankruptcy. One moment last year when the gravity became particularly apparent was when Asian carriers (in countries with low COVID-19 rates) began offering "flights to nowhere" — starting and ending at the same airport as a way to earn some cash from would-be travelers who missed the in-flight experience.
More than a year later today, experts believe that air traffic won't return to normal levels until 2024.
But beyond the financial woes, the unprecedented slowdown in air travel may bring some silver linings as key aspects of the industry are bound to change once back in full spin, with some longer-term effects on aviation already emerging. Here are some major transformations to expect in the coming years:
Cleaner aviation fuel
The U.S. administration of President Joe Biden and the airline industry recently agreed to the ambitious goal of replacing all jet fuel with sustainable alternatives by 2050. Already in a decade, the U.S. aims to produce three billion gallons of sustainable fuel — about one-tenth of current total use — from waste, plants and other organic matter.
While greening the world's road transport has long been at the top of the climate agenda, aviation is not even included under the Paris Agreement. But with air travel responsible for roughly 12% of all CO2 emissions from transport, and stricter international regulation on the horizon, the industry is increasingly seeking sustainable alternatives to petroleum-based fuel.
Fees imposed on the airline industry should be funneled into a climate fund.
In Germany, state broadcaster Deutsche Welle reports that the world's first factory producing CO2-neutral kerosene recently started operations in the town of Wertle, in Lower Saxony. The plant, for which Lufthansa is set to become the pilot customer, will produce CO2-neutral kerosene through a circular production cycle incorporating sustainable and green energy sources and raw materials. Energy is supplied through wind turbines from the surrounding area, while the fuel's main ingredients are water and waste-generated CO2 coming from a nearby biogas plant.
Farther north, Norwegian Air Shuttle has recently submitted a recommendation to the government that fees imposed on the airline industry should be funneled into a climate fund aimed at developing cleaner aviation fuel, according to Norwegian news site E24. The airline also suggested that the government significantly reduce the tax burden on the industry over a longer period to allow airlines to recover from the pandemic.
High-flying ambitions for the sector
Hydrogen and electrification
Some airline manufacturers are betting on hydrogen, with research suggesting that the abundant resource has the potential to match the flight distances and payload of a current fossil-fuel aircraft. If derived from renewable resources like sun and wind power, hydrogen — with an energy-density almost three times that of gasoline or diesel — could work as a fully sustainable aviation fuel that emits only water.
One example comes out of California, where fuel-cell specialist HyPoint has entered a partnership with Pennsylvania-based Piasecki Aircraft Corporation to manufacture 650-kilowatt hydrogen fuel cell systems for aircrafts. According to HyPoint, the system — scheduled for commercial availability product by 2025 — will have four times the energy density of existing lithium-ion batteries and double the specific power of existing hydrogen fuel-cell systems.
Meanwhile, Rolls-Royce is looking to smash the speed record of electrical flights with a newly designed 23-foot-long model. Christened the Spirit of Innovation, the small plane took off for the first time earlier this month and successfully managed a 15-minute long test flight. However, the company has announced plans to fly the machine faster than 300 mph (480 km/h) before the year is out, and also to sell similar propulsion systems to companies developing electrical air taxis or small commuter planes.
New aircraft designs
Airlines are also upgrading aircraft design to become more eco-friendly. Air France just received its first upgrade of a single-aisle, medium-haul aircraft in 33 years. Fleet director Nicolas Bertrand told French daily Les Echos that the new A220 — that will replace the old A320 model — will reduce operating costs by 10%, fuel consumption and CO2 emissions by 20% and noise footprint by 34%.
International first class will be very nearly a thing of the past.
The pandemic has also ushered in a new era of consumer demand where privacy and personal space is put above luxury. The retirement of older aircraft caused by COVID-19 means that international first class — already in steady decline over the last decades — will be very nearly a thing of the past. Instead, airplane manufacturers around the world (including Delta, China Eastern, JetBlue, British Airways and Shanghai Airlines) are betting on a new generation of super-business minisuites where passengers have a privacy door. The idea, which was introduced by Qatar Airways in 2017, is to offer more personal space than in regular business class but without the lavishness of first class.
Aerial view of Rome's Fiumicino airportcommons.wikimedia.org
Rome's Fiumicino Airport has become the first in the world to earn "the COVID-19 5-Star Airport Rating" from Skytrax, an international airline and airport review and ranking site, Italian daily La Repubblica reports. Skytrax, which publishes a yearly annual ranking of the world's best airports and issues the World Airport Awards, this year created a second list to specifically call out airports with the best health and hygiene standards.
The pandemic has also accelerated the shift towards contactless traveling, with more airports harnessing the power of biometrics — such as facial recognition or fever screening — to reduce touchpoints and human contact. Similar technology can also be used to more efficiently scan physical objects, such as explosive detection. Ultimately, passengers will be able to "check-in" and go through a security screening anywhere at the airports, removing queues and bottlenecks.
Data privacy issues
However, as pointed out in Canadian publication The Lawyer's Daily, increased use of AI and biometrics also means increased privacy concerns. For example, health and hygiene measures like digital vaccine passports also mean that airports can collect data on who has been vaccinated and the type of vaccine used.
Auckland Airport, New Zealand
The billion-dollar question: Will we fly less?
At the end of the day, even with all these (mostly positive) changes that we've seen take shape over the past 18 months, the industry faces major uncertainty about whether air travel will ever return to the pre-COVID levels. Not only are people wary about being in crowded and closed airplanes, but the worth of long-distance business travel in particular is being questioned as many have seen that meetings can function remotely, via Zoom and other online apps.
Trying to forecast the future, experts point to the years following the 9/11 terrorist attacks as at least a partial blueprint for what a recovery might look like in the years ahead. Twenty years ago, as passenger enthusiasm for flying waned amid security fears following the attacks, airlines were forced to cancel flights and put planes into storage.
40% of Swedes intend to travel less
According to McKinsey, leisure trips and visits to family and friends rebounded faster than business flights, which took four years to return to pre-crisis levels in the UK. This time too, business travel is expected to lag, with the consulting firm estimating only 80% recovery of pre-pandemic levels by 2024.
But the COVID-19 crisis also came at a time when passengers were already rethinking their travel habits due to climate concerns, while worldwide lockdowns have ushered in a new era of remote working. In Sweden, a survey by the country's largest research company shows that 40% of the population intend to travel less even after the pandemic ends. Similarly in the UK, nearly 60% of adults said during the spring they intended to fly less after being vaccinated against COVID-19 — with climate change cited as a top reason for people wanting to reduce their number of flights, according to research by the University of Bristol.
At the same time, major companies are increasingly forced to face the music of the environmental movement, with several corporations rolling out climate targets over the last few years. Today, five of the 10 biggest buyers of corporate air travel in the US are technology companies: Amazon, IBM, Google, Apple and Microsoft, according to Taipei Times, all of which have set individual targets for environmental stewardship. As such, the era of flying across the Atlantic for a two-hour executive meeting is likely in its dying days.
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